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MACEDONIA

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MACEDONIA BUSSINESS & INVESTMENT OPPORTUNITIES

INTRODUCTION • Open Economy at the Heart of the Balkan Peninsula

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GOVERNMENT • Government Focused on Reforms • Interview with H.E Dr. Gjorge Ivanov, President of the Republic of Macedonia: The Historical Crossroad of Empires is Europe’s Exciting Business Destination

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ECONOMY • Most Free Economy in South East Europe

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• Among the Top 20 Investment Destinations in the World • Invest Macedonia: New Strategies for Increased Effectiveness • Free Zones with World-Class Infrastructure and Superb Service • Interview with Dejan Beshliev, Executive Director of the Macedonian-Russian Chamber of Commerce: A Decade of Successful Business Relations with the Vast Russian Market • Interview with Zore Temelkovski, President of the Macedonian-Bulgarian Chamber of Commerce: Enhancing Mutual Economic, Cultural and Social Initiatives between Macedonia and Bulgaria • Interview with Tuna Eyup Kahveci, former President and current elected member of the Management Board of MATTO: Centuries Old Relations are the New Fundaments of Economic Growth

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Regional Director: Suzana Skoko – Business Analysts: Andrej Petrovski & Goran Velkovski – Head of Production: Ivana Popchev – Production Manager: Kally Themistocleous – Editorial: Tomislav Hristov & Snezana Stefanovska – Design: Panche Prendjov The European Times Zinas Kanther 16 – Karantoki Building – 7th Floor, Office 25-26 – 1065 Nicosia – Cyprus Tel.: +357 22 030248 – [email protected] – www.european-times.com The European Times is a division of Crystal Mediacorp Limited.

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Canyon Matka at the Matka Dam

ENERGY • Interview with Zoran Narashanov, President of the European Business Association: Supporting the Implementation of the EU Standards in the Macedonian Business Sector • MULTICORP HOLDING COMPANY: Leading Holding Company Builds Partnerships Based on Mutual Trust and Loyalty • OVE STEEL: Leading Supplier of Conveyor Rollers Renowned for Quality and Innovative Approach • TRIGLAV INSURANCE: Leading Insurance Company Focused on Innovative Premium Services • SILK ROAD BANK: Building Strong Partnerships with Domestic and International • SAVING HOUSE MOZNOSTI: Financial Inclusion through Savings House Moznosti

• Energy for the Future

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AGRICULTURE • Modernising the Agriculture Sector

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TRANSPORT • Rapidly Developing Transport System



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HEALTHCARE • Aiming to Provide High-quality Healthcare



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TOURISM • Land of Nature and Cradle of Culture • Interview with Krste Blazeski, President of HOTAM: Helping Tourists Discover Macedonia’s Hidden Treasures • HOTEL ISTATOV: Integrated Training and Accommodation Base for High Profile Athletes • HOTEL ROMANTIQUE-VELES: Perfect Getaway in the Heart of Macedonia offers Superb Traditional Cuisine • HOTEL ROMANTIQUE-DOJRAN: Ideal Hotel for Vacation and Events Offers Mesmerizing View of Dojran Lake • HOTEL BELVEDERE: Perfect Blend of Warm Atmosphere and Unique Ambience by the Ohrid Lake • HOTEL DOLCE INTERNATIONAL: Ultra-Modern Hotel in the Heart of Skopje

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Archaeological Museum in Skopje © Zefart Dreamstime.com

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Open Economy at the Heart of the Balkan Peninsula Macedonia is a small, landlocked country which is often referred to as ‘the heart of the Balkan peninsula’. Bordering Kosovo to the northwest, Serbia to the north, Bulgaria to the east, Greece to the south, and Albania to the west, the country enjoys a strategic location in South Eastern Europe and has long served as a major regional and international transport hub, linking Western and Central Europe to Southern Europe and the Aegean Sea. The country has a population of 2.1 million inhabitants, and more than a quarter of the population lives in the capital Skopje. Macedonia is a member of the UN, the Council of Europe, the World Trade Organization, the Central European Free Trade Agreement, and other international organizations. Since 2005, the country has also been a candidate for

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joining the European Union and has applied for NATO membership, which is stalled by Greece’s objection to the country’s name. Macedonia was identified as a potential candidate for EU membership during the Thessaloniki European Council summit in 2003. Its Stabilisation and Association Agreement is in force since 2004, and it is the first in the region. It applied for the EU membership in March 2004 and the Council decided to grant the country candidate status in December 2005, based on the Commission’s favourable opinion. Since October 2009, the Commission has recommended opening of the accession negotiations with the country, until 2015 when it made this conditional on continued implementation of the Przino agreement and substantial progress in the implementation of the “Urgent Reform Priorities”. The new Gov-

ernment expects positive report for Macedonia from the European Commission in the spring of 2018, followed by a clear and unconditional recommendation for the start of Macedonia’s EU accession talks. Macedonia is expecting an automatic invitation from NATO and opening of EU negotiation talks once the name issue with Greece is resolved and, according to Macedonia’s Prime Minister Zoran Zaev, the country is committed to finding a solution to the dispute, as early as the first half of 2018. Following the election of the new Government in 2017, Macedonia resumed negotiation talks with Greece under the auspices of the UN, which were stalled during the last several years.

Stable, market-oriented economy with significant potential Since its independence in 1991, Macedonia has made progress in liberalizing its economy and improving its business environment, undergoing considerable economic reforms and developing into a stable, open market economy with trade accounting for the largest share of the country’s GDP in recent years. Macedonia offers a number of attractions as a base for trade-oriented enterprises seeking opportunities in this rapidly developing region. In addition to its strategic location at the ‘heart of the Balkans’ and the lowest taxes in Europe, Macedonia’s competitive advantages include political, monetary and macroeconomic stability, excellent infrastructure, low cost and high skilled workforce, ‘one stop shop’ system for businesses, numerous trade agreements etc.

Ambitious Government Program 2017–2020 The ambitious reform agenda outlined in the Government Program 2017–2020 focuses on economic growth, job creation, fair taxation, support to small and medium enterprises (SMEs), and reform of social protection for the most vulnerable. In addition, the Government adopted the 3-6-9 Action Plan, which includes a set of measures improve the quality of life of the citizens and to accelerate the process of EU and NATO accession, with the aim of securing a date for the start of EU accession negotiations by the next European Commission Progress Report in spring 2018.

Progress towards achieving strategic priorities The Government has identified the most important strategic priorities, which include growth of the economy, increase of the productive employment and raising of the living standard of the citizens; integration of the Republic of Macedonia in both the European Union and NATO; decisive and non-selective fight against organized crime and corruption; rule of law and building independent institutions; education reforms and investments in innovations and information technology; judiciary-related reforms; and full implementation of Ohrid Framework Agreement principles, nation-state building and ethnic cohesion on the principles on mutual tolerance and respect. In the past months, significant progress has been made towards achieving these priorities, and the Government remains fully dedicated to the implementation of the necessary reforms. Recently, the President of the European Commission Jean-Claude Junker commended the country’s progress in reaching its reform goals which are taking place in several sectors: the judiciary, public administration, the intelligence services and the media.

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INTRODUCTION

Host of the First Western Balkans Digital Summit Macedonia will host the First Western Balkans Digital Summit, which will take place on 18-19 April 2018 in the capital Skopje. The event is organized by the Regional Cooperation Council (RCC) in cooperation with the European Commission and German Federal Ministry for Economic Affairs and Energy. The summit will focus on the Digital Integration Agenda and how digital transformation spurs economic activity in the Western Balkans. Being ‘the first of its kind’ in the region, the Summit will present the region in a positive light, as an integral part of global processes and as being part of the emerging digital family. It will be held as part of the bid for establishing a digital market, as one of the priorities of the European Commission for 2015-2019, and it is expected to herald fresh opportunities and prospects for the digital world. The two-day forum will focus on digital networks and services, confidence and security, digital skills and digital economy and society. It will also feature a segment where digital IT companies, IT educational institutions and innovators can showcase their products and services.

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Government Building © Pulios Dreamstime.com

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Government Focused on Reforms The Republic of Macedonia is a parliamentary representative democratic republic, with a Prime Minister as the Head of Government and a President as the Chief of State. The country’s Constitution was adopted on 17 November 1991 and is in effect since 20 November 1991. The country proclaimed its independence in 1991, and its national holiday is National Day, celebrated on 8 September. Government organization Executive branch Macedonia’s Chief of State is the President, currently Gjorge Ivanov (since 12 May 2009). The Head of the Government is the Prime Minister, officially referred to as the President of the Government of the Republic of Macedonia, currently Zoran Zaev (since 31 May 2017). The Prime Minister is assisted by Deputy Prime Ministers from the Council of Ministers. Legislative branch Macedonia’s legislative branch is a unicameral Assembly or Sobranie. The Assembly currently has 123 seats, out of which 120 members are directly elected in multi-seat constituencies by proportional representation vote and

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three are directly elected in diaspora constituencies worldwide by simple majority vote, provided candidates meet a specified minimum vote count. The members of the Assembly serve four-year terms. Judicial branch Macedonia is a civil law system with judicial review of legislative acts. At the international level, Macedonia accepts compulsory ICJ jurisdiction, but has not submitted an ICJ jurisdiction declaration. The highest courts in the country are the Supreme Court, which consists of 22 judges, and the Constitutional Court, which consists of nine judges. The Supreme Court judges are nominated by the Judicial Council, a seven-member body of legal professionals, and are later appointed by the Assembly. The Constitutional Court judges are appointed by the Assembly for nonrenewable 9-year terms.

GOVERNMENT

Venko Filipce Minister of Health

Macedonia has universal suffrage and all citizens age 18 or older may vote. The President is directly elected by absolute majority popular vote in two rounds if needed for a five-year term and is eligible for a second term. Following the parliamentary elections, the President nominates a candidate from the majority party or parties in the Assembly, who then proposes the Government who are elected by the Assembly.

Bilen Saljiji Minister of Justice

Administrative System

Ljupcho Nikoloski Minister of Agriculture, Forestry and Water Supply

With the passage of a new law and elections held in 2005, local government functions are divided between 78 municipalities. The capital, Skopje, is governed as a group of ten municipalities collectively referred to as ‘the City of Skopje’. Municipalities in Macedonia are units of local self-government.

Government The members of the Cabinet are chosen by the Prime Minister and approved by the Assembly. Zoran Zaev Prime Minister

Goran Sugareski Minister of Transport and Communication Kresnik Bekteshi Minister of Economy

Damjan Manchevski Minister of Information Society and Public Administration



Mila Carovska Minister of Labour and Social Policy Renata Deskoska Minister of Education and Science Suhejl Fazliu Minister of Local Self-Government

Deputy Prime Ministers:

Robert Alagjozovski Minister of Culture

Radmila Shekerinska Deputy Prime Minister and Minister of Defence

Sadula Duraki Minister of Environment and Physical Planning

Oliver Spasovski Deputy Prime Minister and Minister of Internal Affairs

Robert Popovski Minister without Portfolio in charge of Communications, Accountability, and Transparency

Bujar Osmani Deputy Prime Minister in charge of European Affairs Kocho Angjushev Deputy Prime Minister in charge of Economic Affairs Hazbi Lika Deputy Prime Minister in charge of implementing the Framework Agreement and the Political System Other ministers: Nikola Dimitrov Minister of Foreign Affairs Dragan Tevdovski Minister of Finance

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Elections

Edmond Ademi Minister without Portfolio in charge of Diaspora Adnan Qahil Minister without Portfolio in charge of Foreign Investments Aksel Ahmedovski Minister without Portfolio in charge of Implementing the Roma Inclusion Strategy Zoran Shapuric Minister without Portfolio in charge of Regulations for Improvement of the Investment Climate for Domestic Companies Zorica Apostolska Minister Without Portfolio in charge of Foreign Investments

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THE EUROPEAN TIMES H.E. Dr. Gjorge Ivanov, President of the Republic of Macedonia

The Historical Crossroad of Empires is Europe’s Exciting Business Destination Serving his second mandate as President of the Republic of Macedonia, H.E. Dr. Gjorge Ivanov, the renowned political scientist and leading expert in the field of civil society, turned President in 2009, is guided by the principles of nurturing the existing and creating new partnerships for the country in Europe and the world. Emphasising his efforts towards strengthening the national unity and opening new horizons for the Republic of Macedonia on international level, he reflects on the country’s past, present and future development plans. European Times: What were your goals at the beginning of your mandate, and how have they developed throughout time? What were the biggest accomplishments and challenges that the country has faced during your tenure? H.E. Dr. Gjorge Ivanov: As a country, since our independence, we have set two main strategic goals: becoming a member state of NATO and the EU. Ever since then, the blockades on our path have prolonged the realisation of these goals, so we had to adapt to the newly-created ambient. Since day-one of my mandate, I have promoted the politics of openness to all. In addition to the strategic goals of becoming NATO and EU member country, our openness to neighbours, the surrounding region, Middle Eastern and North African countries, has created oppor8

tunities to acquire new friendships, generating improved conditions for our businesses. Overall, the politics of openness and good inter-state relations, while focusing on our resources and disposable capacities, in the background of the developments within the EU and NATO which are prone to changes, have dominated my term in office. European Times: How has Macedonia dealt with the global economic crisis? H.E Dr. Gjorge Ivanov: In the peak of the financial crises which have started in 2008 and pulled down many national economies, Macedonia had shown growth and development mainly as the result of foreign direct investments. As the budget began to grow, the country gained strength

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European Times: As one of the fastest growing economies, Macedonia is promoted as an excellent investment destination. How would you describe Macedonia’s economic growth? To what extent have foreign direct investments influenced Macedonia’s economy? H.E. Dr. Gjorge Ivanov: Macedonia ranks high on the lists of all international agencies that monitor the openness of economies and access to foreign direct investments. These rankings have proved the effects of suitable internal economic policies of the country, which inevitably attracted the attention of foreign investors. These foreign direct investments have also shown the need for adjustments in our educational system so that it can provide qualified professionals for the 21st century. The third millennium has no need for general profiles of workers, but workers with interdisciplinary competencies. Therefore, the Macedonian educational system is being reformed to provide qualifications which are deficient in the international labour market. European Times: What has been done and what are your recommendations for enhancing regional cooperation? H.E. Dr. Gjorge Ivanov: There are many regional projects in the areas of ecology and environmental impact, conservation of natural resources and enhancing collaboration on the municipal level, which are supported by our country in cooperation with the European Union. Many regional projects and cooperation initiatives have been launched to heal the wounds created by the break-up of the Yugoslav Federation, and so far, they have succeeded to recover the process of dialogue, cooperation and trust among the post-Yugoslav republics. Balkan countries became aware that they can improve their infrastructure only through regional cooperation and that bridging territorial and cultural barriers will open them to new opportunities and growth prospects. In that direction, as President, since day-one of my mandate, I have supported the Adriatic-Ionian highway, as well as linkages of all kinds between Balkan countries and beyond. By opening the region, the mindset of the people opens as well, and the borderless ambience creates positive competition among nations, leading to new ideas, products and services. Since gasification remains one of the greatest regional projects of our time, I believe that the benefits of a cleaner living environment and more affordable energy will soon be enjoyed by every country involved in these projects. At the level of Presidents from the region, we cooperate not only on formal state matters but also on more informal

projects aimed at supporting the youth, such as my School for Young Leaders. European Times: As a university professor, you have always promoted the value and the importance of youth. You have mentioned the School of Young Leaders, could you please describe the impact it has on young Macedonians? H.E. Dr. Gjorge Ivanov: Since day one of my Presidency, I have asked myself what would a professor do in politics, if not establish his school? Therefore, the School for Young Leaders, from an idea has turned into reality successfully running for seven years in a row. By now, the school has trained over 280 outstanding young individuals, from Macedonia, as well as international participants, which have been educated by over 150 leaders from the global political, business, scientific, cultural and other areas of expertise.

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to invest in projects which have been neglected in the past. We have computerised education; hospitals became better equipped, and infrastructure has been developed. We are currently building three major highways, two of which are part of important Trans-European corridors.

By knowing that the youth of today are the leaders of the present and the future, our investment in the young people of Macedonia is our investment in the future of the country. European Times: You say that Macedonia is a country with “a lot of history and less geography.” How has history and the kaleidoscope of ethnicities living on its territory shaped the country’s past, present and how will it shape its future? What are Macedonia’s advantages as a multi-ethnic society? H.E. Dr. Gjorge Ivanov: Macedonia has a rich heritage from the past, which makes its multi-ethnic legacy a project to be preserved in the future. Spread on a piece of land where many empires have left their mark, Macedonia has attained harmony for all ethnic communities that are living on its soil through mutual respect and integration without assimilation. Although the democratic principle of including everybody and excluding no one might be the most complex one for good governance of the country, at the same time, it is something we are very proud of as Macedonians. European Times: You are known as a president who has visited every square meter of his country. How would you describe Macedonia to our readers, especially those interested in Macedonia as a tourist destination? H.E. Dr. Gjorge Ivanov: While some people may have heard about Macedonia from the Holy Bible, others may have heard from the name dispute with Greece, or even from the NASA’s consideration of our observatory Kokino as the World’s fourth oldest observatory, from the Neolith times. Macedonia is known as a land of natural beauties, high peaks, deep-blue lakes, endemic species, beautiful villages, churches, monasteries, and countryside, which combined with great food and hospitability of the people, represents a destination that everyone should visit at least once in a lifetime. 9

INTRODUCTION

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Most Free Economy in South East Europe Macedonia has a track record of low inflation and financial stability, underpinned by a credible and coherent macroeconomic and financial policy framework consistent with the longstanding exchange rate. Structural indicators such as GDP per capita, human development and governance are on an upward trend, and the business climate is favourable, supporting net inflows of FDI and a dynamic export performance. The Government has announced that, starting from 2018, Macedonia will enter a process of financial stabilization and development of the economy.

Economy expected to expand by 4.0% in 2020 The World Bank’s forecast for Macedonia’s 2018 economic growth is 3.2%. The forecast for the country’s GDP growth

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in 2019 is 3.9% and the economy is expected to expand by 4.0% in 2020. The country’s 2017 GDP growth estimate was 1.5% according to the World Bank, a decline which was mainly due to the political disturbances from previous years. GDP growth slowed sharply in the first three quarters of 2017, down from 2.9% in 2016, as political uncertainty weighed on investment, but the country witnessed a rebound in the fourth quarter based on a pick-up in industrial production, exports and credit growth.

New economic growth plan announced In November 2017, the government adopted the 2018-2020 Fiscal Strategy of the Republic of Macedonia, which included several new measures for improving the management of the public finances. Novelties include changes

ECONOMY

in the software of the Public Procurement Bureau made in February 2018, which introduced public availability of all contracts as well as insight into the tender documentation. The 2018 budget is aimed at providing Macedonia with medium term budget planning. The Government’s priority was to introduce realistic medium-term planning, deemed as one of the most important segments of the strategy on managing public financing. It represents an action plan on reforms from 2018 to 2021 that includes reforms of all key elements of the public financing system. In the fourth quarter of 2017, the Government presented their Economic Growth Plan, which will become a Strategic Program for Economic Development. The plan is focused on support for domestic and foreign companies, creation of new and better paid jobs, technological development and stimulation of exports. A new law which will contain the measures from the Economic Growth Plan is being finalized and the Government expects that the parliamentary procedure for the passing of the law will be completed by the end of March.

Ranked first on the Index of Economic Freedom in SEE Macedonia ranked first among the countries of South East Europe in the 2018 Index of Economic Freedom published by The Heritage Foundation. The country’s overall score was above the European and world averages. On global level, Macedonia ranked 33rd in the annual index, with a score of 71.3 points from a maximum 100. As stated in the report, “The country’s overall score has increased by 0.6%, with improvements in scores for the fiscal health and investment freedom indicators offsetting declines in government integrity and judicial effectiveness”. Macedonia did best in terms of trade, business and monetary freedom, as well as tax burden. The company’s performance was hampered by the indicators related to rule of law, namely government integrity, judicial effectiveness and property rights.

Fitch affirmed Macedonia’s ‘BB’ ratings Fitch Ratings revised the outlooks on Macedonia’s long-term foreign and local-currency issuer default ratings (IDRs) to positive from negative and affirmed the country’s ratings at ‘BB’. According to their assessment, “The domestic political situation is stabilising, and key international relations are improving, after a prolonged political crisis between 2014 and 2017, which saw Macedonia suffer the second largest percentage drop in the World Bank governance indicator out of all Fitch-rated sovereigns”.

Preliminary outturns suggest the 2017 central government budget deficit was 2.7% of GDP, below the government’s supplementary budget target of 2.9% and in line with 2016 deficit. The government under-executed expenditures to meet the deficit target in the light of lower than expected revenues, enhancing confidence in its commitment to fiscal targets. The government is targeting a central government budget deficit of 2.7% of GDP in 2018, and then a reduction to 2.5% in 2019, 2.3% in 2020 and 2.0% in the medium term. Estimate put the general government debt at 39.2% of GDP at end-2017 and government guarantees of non-financial SOEs were an additional 8.2% of GDP, taking total public debt to 47.4% of GDP. This would be the first decline in the ratio (from 48.5% in 2016) after rising for nine years from 23% in 2008.

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Decreasing budget deficit

“In recent years, we have witnessed a drop in the budget deficit and I believe the public debt will be stabilized in the period to come. The fact that the Euro-bond was issued in January, in a very favourable climate, is positive”, Dimitar Bogov, Governor of the National Bank of the Republic of Macedonia recently stated.

Well-capitalised, liquid and profitable banks Banks are well-capitalised, liquid and profitable, and a majority of assets are controlled by foreign-owned institutions, reducing potential contingent liabilities. Credit to the private sector is moderate at 48% of GDP. The nonperforming loan ratio declined to 6.3% in 2017, from 6.6% in 2016.

Robust increase of exports Exports of goods and services grew a robust 13.1% in the first three quarters of 2017, compared with 8.6% for imports. Macedonia has gained market share in its main export market (the EU) and moved up the value-added chain evident in the rising share of exports of machinery and transport equipment and chemical products.

Prepared for possible global market turbulence Macedonia economy well prepared for possible global market turbulence. Dimitar Bogov, Governor of the National Bank of the Republic of Macedonia, announced that “Macedonia’s economy should be vigilant, but it is prepared well to handle turbulence that might occur on financial markets globally”. He pointed out that Macedonia has taken a series of measures with which the banking sector was enhanced.

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Among the Top 20 Investment Destinations in the World Macedonia is a superb investment destination due to numerous reasons, including its strategic location, macroeconomic stability, excellent infrastructure, growing FDI, growing foreign trade, various trade agreements, highly skilled and relatively cheap workforce, low taxes, government incentives, ease of doing business, investor friendly climate, EU and NATO candidate country status, etc. Macedonia holds the 11th position in the World Bank’s Ease of Doing Business 2018 report and is the only upper-middle-income economy among the first 20 countries on the list. Macedonia has the most attractive tax package in Europe. There is a flat tax rate of 10% for corporate and personal income, which simplify the tax system and stimulate successful companies to further improve operations and increase profitability. Furthermore, there are various government subsidies, depending on the type of investment.

Superb location and excellent transport infrastructure Macedonia is at the cross-roads of South Eastern Europe, which makes it an ideal transit and distribution centre for

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products for European markets. The developed road and railway infrastructure, in combination with the small area of the country enables access to every inhabited place in Macedonia in less than three hours. Furthermore, all of Europe in can be reached within one to three days via truck or rail, and international seaports can be reached within one to three hours. Macedonia is also relatively close to the markets of Middle East and North Africa. Furthermore, Macedonia has excellent transport infrastructure, with two international airports and a good road and railway network, which is constantly improving. Macedonia also has a modern digital telecommunications network and the Macedonian telecommunications sector is the most liberalized in the region. At the moment, fixed telephone services are offered by eight companies, while mobile telephony is in constant development. The presence of three mobile operators guarantees quality and availability of services.

Market access to 650 million customers Macedonia is a signatory of three multilateral Free Trade Agreements: SAA (Stabilization and Association Agreement) with the EU member states; EFTA (Switzerland, Norway, Iceland and Liechtenstein); and CEFTA

BUSSINESS & INVESTMENT OPPORTUNITIES

FDI a priority of the Government FDI remain a priority of the Government. Currently there are two ministers without Portfolio in charge of Foreign Investments, as well as a Minister without Portfolio in charge of Regulations for Improvement of the Investment Climate for Domestic Companies. Furthermore, the Government announced that, starting from 2018, they are beginning a process of financial stabilization and development of the economy, as important prerequisites for improving the quality of life for all citizens. For this purpose, the Budget for 2018 allocates €50 million for program for economic development, and additional €16 million for measures for increasing employment. In the fourth quarter of 2017, the Government presented their Economic Growth Plan, which will become a Strategic Program for Economic Development. The plan is focused on support for domestic and foreign companies, creation of new and better paid jobs, technological development and stimulation of exports. A new law which will contain the measures from the economic growth plan is being finalized and the Government expects that the parliamentary procedure for the passing of the law will be completed by the end of March. The main change of the new economic policy is the fact that the privileges for foreign investors will also be available for domestic companies. The business climate in the country will be improved through changes in the regulation, which will give domestic companies more opportunities for investment and growth. Furthermore, the new policy is focusing on transparency, offering public access of the arranged conditions and equal conditions for all investors.

In addition, there is a Foreign Investors Council under the Economic Chamber of Macedonia, composed of foreign businessmen and experts who work at Macedonian trade companies. Established in 2006, the Council’s primary aims include improvement of the investment and business development climate in Macedonia by making concrete reform proposals, stimulation of foreign direct investments, assistance in overcoming the differences which may exist in the relations with foreign investors, etc.

One-stop-shop for investors Macedonia has introduced a one-stop-shop system that enables investors to register their businesses after four hours of submitting on application (in practice, it might take 1-2 business days). Individuals can register a company in Macedonia by visiting one office, obtaining the information from a single place, and addressing one employee. This significantly reduces administrative barriers and start-up costs.

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(Macedonia, Albania, Moldova, Serbia, Montenegro, Bosnia and Herzegovina and Kosovo). In addition to the multilateral, Macedonia has also signed two bilateral Free Trade Agreements with the Turkey and Ukraine. Combined, these agreements give Macedonia duty free access to more than 650 million consumers. Macedonia has also been a member of the World Trade Organization since 2003. Furthermore, Macedonia has signed numerous investment protection treaties and agreements for avoidance of double taxation.

New investments announced In February 2018, Deputy Prime Minister Kocho Angjusev announced that there are eight new companies which ready to invest a total of €73.5 million in the Free Economic Zones in Macedonia, which are expected to create a total of 1.500 new jobs. The government has announced that the contracts with these companies have already been signed and the detailed presentation of the projects will be made in the coming months. Contracts have been signed with Murat Ticaret Kablo with a €4.5 million investment and opening of 300 new jobs; Cemdag Lighting with €4 million and 200 jobs; Kessler with €2 million and 80 jobs; Dogan Otomotiv with €1 million and 30 jobs; Sagen with €20 million and 250 jobs; Catagay Kablo with €6 million and 300 jobs; WIK with €6 million and 50 jobs; and Kostal which will expand its capacity through a €30 million investment and 350 new jobs. According to the statement of the Deputy Prime Minister, six companies already investing in Macedonia will also double their capacities thanks to the opportunities offered by the Government through its programme for fostering economic growth.

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BUSSINESS & INVESTMENT OPPORTUNITIES

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New Strategies for Increased Effectiveness The Agency for Foreign Investments and Export Promotion of the Republic of Macedonia – Invest Macedonia – is the primary government institution which is in charge of attracting new foreign investments in the country and supporting the expansion of the foreign companies with already established operations. In addition to the investment function, Invest Macedonia is also engaged in promoting the Macedonian companies on foreign markets and supporting them in the process of increasing their exports abroad. Invest Macedonia is helping both foreign and Macedonian companies by creating and adding value for them with their broad knowledge and experience of the business environment and opportunities in Macedonia and other countries as well as by their close collaboration with various partner institutions and organizations. The primary aim of Invest Macedonia is to be recognized by the companies and all other partners not only as a government institution but also as a professional and proactive service organization oriented towards meeting the requirements of the business community.

Upward trend in attracting FDI Foreign direct investments in Macedonia have registered an upward trend in recent months. With the new economic policy, the Government has created many success stories. Currently, there are 19 companies with which the Government is in direct negotiations at the last stage, and with some of them the Government has already signed contracts.

Changing policies for increasing effectiveness Invest Macedonia has undergone some recent changes in their modus operandi, aimed at improving and increas-

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ing the Agency’s effectiveness. The new policies and strategies decrease costs and are expected to bring significantly larger impact. For example, instead of the prior 33 economic promotors, which represented a significant portion of the Agency’s budget, there will be 20 economic attachés sent to various parts of the which are of strategic importance for Macedonia, a move which will meaningfully unburden the budget. Furthermore, the Agency has cut down on media campaigns and promotions and has redirected funds towards support of export of the domestic companies. The strategy of the current Government is direct communication with potential investors and communication through business networks and promotional events.

Planned export promotion events for 2018 Invest Macedonia is planning several export promotion business events and fairs for 2018. For the Electro-Metal Industry, the Agency will organize a Conference and B2B event Macedonia Manufacturing Expo 2018, as well as a promotional stand at the Annual Meeting of the Association for Supply Chain Management, Procurement and Logistics (BME) in November in Berlin. For the Textile Industry, there will be business meetings in Denmark, Sweden or Norway for textile companies and brands in the Scandinavian market, as well as a national exhibition stand at the Munich Fair - Munch Apparel Source in September. For the Agrobusiness and Food Processing Industry, there will be business meetings with domestic and foreign companies in dedicated to natural ingredients, as well as a national exhibition stand at the ProAgra Fair in Poland in May. For the ICT industry, the Agency is organizing a national exhibition stand at the ANAGACOM Fair in Cologne, Germany in June.

Free Zones with World-Class Infrastructure and Superb Service The Directorate for Technological Industrial Development Zones (DTIDZ) is the governmental managing body responsible for developing the free zones throughout the country. Approved by the Government in August 2000, the Free Zones Authority was officially launched in January 2002. The Free Zones Authority aims to assist in providing the most cost and operationally efficient place for doing business in South-eastern Europe and wider. The popularity of the free zones is based on the simplicity and effectiveness for doing business, beneficial and longlasting tax incentives, and opportunities for additional government grants. The Free Zones Authority’s strive is to become an international business hub in South-Eastern Europe by providing world-class infrastructure supported with service excellence and incentives unparalleled anywhere in the region and wider. Macedonia offers additional incentives for development in the TIDZs, in addition to those normally associated with free economic zones. Investors in TIDZs are entitled to personal and corporate income tax exemption for the first 10 years. Investors are exempt from payment of value added tax and customs duties for goods, raw materials, equipment and machines. Moreover, up to €500.000 can be granted as incentive towards building costs depending on the value of the investment and the number of employees. Land in a TIDZ in Macedonia is available under long-term lease for a period of up to 99 years. Other benefits include completed infrastructure that enables free connection to natural gas, water, electricity and access to a main international road network. Investors are also exempt from paying a fee for preparation of the construction site. Fast procedures for business activity registration are provided in TIDZ that further reduce the costs of setting up. The Government pays special attention to production activities, activities from the IT area (software development, hardware assembling, digital recording, computer chips and the like), scientific research activity and new technologies with high environmental standards, for which additional benefits are envisaged in the TIDZs.

Investors in TIDZs who operate in these areas are exempt from the liability for submission of a guarantee as collateral for any customs arrears.

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GOVERNMENT

Free Zones Authority’s duty is establishing a service centre within each of the zones, providing consultation and services for users of the zones. Users can expect firstrate administrative services and expeditious customs clearance. The Free Zones Authority carries out a one-stop service mode, and its management model closely follows international practice, ensuring maximum investor benefits.

Three fully operational zones and 11 zones in various stages of development Technological–Industrial Development Zones (TIDZs) are centres in which highly productive clean manufacturing activities are concentrated and new technologies are developed. The Free Zones Authority currently manages three fully operational zones: Skopje 1 and 2 in the capital, and one in Stip, the largest town in eastern Macedonia. Simultaneously, twelve zones intended for equal economic advancement of all regions in Macedonia are in various stages of development. The zone in Tetovo is currently operating as a public private partnership and is in the process of implementing its first investment projects. Other zones include: Skopje 3, Prilep, Struga, Strumica, Kicevo, Gevgelija, Berovo, Delcevo, Radovish, Rankovce, and Vinica. The total area of the Skopje 1 free zone is 140.18 hectares, and of Skopje 2 free zone is 96.75 hectares. Both are located 10 km east of the capital Skopje, on the crossroads of Corridors 8 and 10, near the E-75 highway and the Skopje International Airport. The total area of the Stip free zone is 206.43 hectares. It is located northwest from the city of Stip, upon entering from the Skopje direction. The Stip free zone has road connections to Skopje and Kocani through interstate M5 and through the new Skopje-Stip highway, the region will have a direct and short road connection to the capital Skopje.

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BUSSINESS & INVESTMENT OPPORTUNITIES

A Decade of Successful Business Relations with the Vast Russian Market THE EUROPEAN TIMES

Pharmacy, construction, tourism, agriculture and wine industry are areas of high business interest in commercial relations between Macedonia and the Russian Federation. Established a decade ago with the goal of renewing economic ties between both countries, the Macedonian-Russian Chamber of Commerce is led by Dejan Beshliev, Executive Director, who takes pride in the fact that its membership consists of 147 companies from various business and industry sectors. Dejan Beshliev Executive Director of the Macedonian-Russian Chamber of Commerce

the most significant imports and investments from Russia are in the sectors of oil, gas and mining. The motives for our establishment have been to create new bridges of collaboration, new contacts and new opportunities. Therefore, we keep our business people informed about the rules and regulations of the Russian market and serve as contact point for Russian companies when they are looking for opportunities in our market, in collaboration with the Macedonian government, whose primary objective is to attract foreign direct investments and know-how. European Times: Which companies have the honour to be part of your organisation? Which are the most attractive business potentials of the bilateral economic cooperation on which you are working?

European Times: What are the primary goals of your organisation? Dejan Beshliev: The chamber has several main objectives, which all come under the overall mission of renewing relations with the Russian Federation. These are economic goals above all, aimed at improving the response to the needs of Russian business people in offering high-quality products and their placement on the Russian market. The absolute peak in our trade with the Russian market was 25 years ago when the trade exchange reached US$1 billion with an equal trade balance of approximately US$500 million from each side. Currently, our largest exports to Russia are agricultural products and pharmaceutics, while

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Dejan Beshliev: The broad spectre of sectors from which the companies come is a strong foundation for the accelerating collaboration. Whether it is manufacturing, energy, service industries, pharmacy, construction, tourism, agriculture or wine industry we have members who are successfully doing business with their Russian counterparts. We are helping them to find partners who would buy not only their products but would also build long lasting business relations and strategic partnerships. In the past ten years, Russian companies became more active in their cooperation with their Macedonian counterparts, although there is a lot of space for improvement. Gross investments from Russia to Macedonia have surpassed the amount of US$400 million. Macedonia has no political restrictions on trade with Russia, while our free trade agreements EU, EFTA and CEFTA countries, plus Turkey and Ukraine provide investors with access to over 650 million customers. These facts point us to the conclusion that there are vast business opportunities which are waiting to be exploited.

BUSSINESS & INVESTMENT OPPORTUNITIES

Enhancing Mutual Economic, Cultural and Social Initiatives between Macedonia and Bulgaria with main goal to develop the economic relations between the two countries, creating link between the companies with common interests and promoting the business activities. Zore Temelkovski, President of the Macedonian-Bulgarian Chamber of Commerce, points out the main priorities of the association.

European Times: What are the milestones of your professional career?

Zore Temelkovski President of the Macedonian-Bulgarian Chamber of Commerce

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Formed in 2011, the Macedonian-Bulgarian Chamber of Commerce is a non-profit business association,

Zore Temelkovski: Having the chance to create large social network as a former basketball player, led me to the position of being one of the founders of the Macedonian Basketball Federation. When the country entered in new democratic and social changes, I was elected as a member of the Parliament for two mandates. Being an economist and foremost entrepreneur, I have established the first private company in Macedonia - Ino Spektar, marking the beginning of a new era of entrepreneurship in the country. Focusing my business relations on Bulgaria and Slovenia has proved as a successful business strategy. This was the main reason I was elected for the President of the Macedonian-Bulgarian Chamber of Commerce in 2013. European Times: What are the main priorities of the Chamber? Zore Temelkovski: Our main priority is to promote the economic relations between the companies, bringing together the markets of Macedonia and Bulgaria. Bulgaria is the sixth trade partner of Macedonia, but trade is mainly composed of non-ferrous metals and oil products. In this context, the Chamber advocates for expansion of the bilateral trade, rising up from the constant €700 million to €1.000 million per year. The key to accomplish all this is to develop better infrastructure, bridging Black with the Adriatic Sea through Macedonia and making the Corridor 8 competitive. The construction of the railroad to Bulgaria, which should be finalized in 2022, will bring the expected results, but I personally believe that there is even greater benefit if highway to Sofia is constructed. Other priorities of the Chamber are the common energy policy, especially around the pipelines, the establishment of interstate investment fund for export companies and cooperation on the development of joint products in order to conquer third world markets.

European Times: Why should foreign investors target Macedonia? Zore Temelkovski: One of the most successful Bulgarian investments in Macedonia is Minstroj, but we cannot underestimate the other companies. We also have a lot of small and medium size companies that slowly but surely enter the market with their own products, getting bigger every day. I would like to encourage new foreign investors to come and invest in this region. This is a country with very talented and educated people capable to respond to any challenges, fulfilling the European criteria.

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BUSSINESS & INVESTMENT OPPORTUNITIES

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Centuries Old Relations are the New Fundaments of Economic Growth In recent years Macedonia has developed into an attractive destination for foreign direct investments. The country has invested substantial resources to outperform the intense competition in the region, as almost all neighbouring countries offer significant incentives to foreign investors. However, as Tuna Eyup Kahveci, former President and current elected member of the Management Board of the MacedonianTurkish Chamber of Commerce (MATTO) notes, Macedonia is winning this battle. European Times: How would you evaluate the overall economic situation in the country?

Tuna Eyup Kahveci, former President and current elected member of the Management Board of MATTO

Tuna Eyup Kahveci: In recent years, Macedonia managed to maintain a steady growth of the GDP, low inflation rate and decreasing levels of unemployment. The country’s economic development has been a top priority of the Government, and this has materialised into an improved business climate, significant deregulation, and a range of tax incentives for the investors, creating a favourable investment climate. Also, the development of Technological and Industrial Development Zones and the investment incentives offered to foreign investors in these zones additionally creating conditions conducive for foreign direct investments. European Times: Which are the main activities and priorities of your chamber? Tuna Eyup Kahveci: We were founded in 2008 when a surge of Turkish investments started coming to Macedonia. The primary goal of our work is to increase the economic relations between companies from both of our countries. We also want to bring new experiences to Macedonia, since it is a young state, but an old civilisation with which we share deep traditional and historical ties. Our vast scope of activities aims to provide comprehensive and up-to-date information on doing business in Macedonia so that we help international investors looking at Macedonia as their potential destination. We offer our services in researching the potential areas for investment; we provide statistical data, legal advice, translation and even facilitation for residence permits or work visas for business people. Our website is an essential tool for investors, as it contains an

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extensive database of all important economic indicators, laws and regulations, translated in three languages. European Times: Which successful businesses have the honour to be part of your chamber? Tuna Eyup Kahveci: We have so many business success stories in Macedonia, in every sector of the economy. We have the main Turkish companies here such as Cevahir Holding, TAV, Sutas, Ramstore, Acibadem. Our companies have invested in virtually every sector of the economy, from transportation, the country’s two airports being operated by Turkey’s TAV under a concession agreement, to food production, health services up to our famous shopping mall chain. We see Macedonia as a logistic base and a convenient access point situated in a secure and hospitable business and living environment, with huge potentials.

BUSSINESS & INVESTMENT OPPORTUNITIES

Established in 2004, by initiative of the Ministry of Economy and the Delegation of the European Commission, the European Business Association (EBA) aims to strengthen the cooperation between the European and the local business community, providing network opportunities and supporting Macedonia’s economic growth. Zoran Narashanov, President, points out the role and the priorities of the Association. Zoran Narashanov President of the European Business Association

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Supporting the Implementation of the EU Standards in the Macedonian Business Sector

ested to develop its businesses in Macedonia. We act as a privileged interlocutor of the Government and the European Commission, working as intermediary between the business community and the European decision makers. European Times: What are the Association’s current activities? Zoran Narashanov: The Association’s main priority is to extend its activities towards the entrepreneurial development of the country, by organizing events such as the European SME Week, European Day of the Entrepreneur. We are continuously working towards the development of a dialog and strong partnership with the institutions, as one of the greatest values for the business community. The Association launched the Project 100, dedicated to increasing EBA’s membership, aims to ensure massive dissemination of the European values.

European Times: What is the Association’s role in the Macedonian business sector? Zoran Narashanov: The EBA’s main role is to create an independent business community that brings together the European companies which operate in the country, with the domestic enterprises, individuals and non-governmental institutions that collaborate with the EU. The Association is not a closed club of privileged companies, but a forum of business-oriented participants, aiming to promote the country’s economic and social development and foster deeper relations with the EU. EBA represents and supports the interests of its members through collective advocacy and networking activities, acting as a catalyst for foreign potential investors inter-

European Times: What is the Association doing towards the attraction of foreign investments? Zoran Narashanov: One of the Association’s goals is to be the main promoter of foreign business investments. In this context, the members of EBA are the major force and base of the association, creating a network of different experiences, possibilities, know- how and skills. We are also actively working towards the implementation of the EU standards, while using the means and know-how of the mother companies in the EU and providing access to assets that are available through the EU funds. I personally believe that every investor should come and invest in Macedonia. We have beautiful nature, amazing and delicious food, and good business conditions. It is the best place to live.

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MEMBERS OF MULTICORP HOLDING COMPANY

GOVERNMENT

Leading Holding Company Builds Partnerships

Based on Mutual Trust and Loyalty Sead Kochan, Owner

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The company constantly invests in the latest state-of-theart equipment and technologies, completing its projects in a timely manner and with exceptionally high standards of quality. In this context, the company is certified with ISO 9001:2008, ISO 14001-2004 and ISO 18001:2007 for quality management, as well as Certificate SO1 948 109. Sead Kochan says, “Our clients recognize the quality that we bring, since our company focuses significantly more on quality rather than quantity”. Transmet participated in the implementation of several vital infrastructure and construction projects of the country, closely cooperating with international companies and providing services for the Ministry of Transport, the Ministry of Agriculture and the Ministry of Defence, as well as the City of Skopje and its municipalities.

A Holding that Creates Unique Image of Quality Service

MULTICORP HOLDING COMPANY DOOEL Skopje, a national holding company, effectively manages several member companies from different sectors-construction, mining, TV and radio broadcasting and media, hotel and hospitability services, education etc. Its member companies are among the top-ranked Macedonian companies, with annual turnover exceeding €100 million, employing more than 1000 employees engaged in different business sectors & industries. MULTICORP HOLDING COMPANY takes great pride in the performance and success of its member companies which are already quality brands in their industries. Transmet DOO Skopje is one of the titans of the construction sector in Macedonia, specialized in complex and extensive infrastructure projects, including road construction, civil engineering, sewerage systems, demolition and transport. With more than 25 years of experience, the company easily conquered the domestic and regional markets, guided by the principles of quality, safety and environment protection. The owner Sead Kochan points out, “As one of its founders, I have been with Transmet since its beginning as a small company with only 13 employees. In the past 25 years we have witnessed Transmet’s rapid growth and exceptional ability to adapt to the changes in the business environment. With the continuous improvement of our services, investments in the latest construction machinery, the maximum respect for deadlines and the capability, innovation and skills of our entire team, Transmet is third among the top 50 companies in Macedonia.”

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The company’s vision is to be visible on the international arena, creating a network of foreign partners and a unique image on global level. Sead Kochan emphasizes, “Aiming to foster exponential growth, we decided to create a system which will include several companies in one, and this Multicorp Holding was born”. He adds, “We first started with Transmet, which is a leading construction company. Then we bought TV Nova, one of the frontrunners of the Macedonian news and media sector. Additionally, we have invested in education, buying the International High school which employs more than 100 individuals. In the tourism and hospitality sector we have the hotel Elite Plaza and we are currently working on the construction of Emporio Mall, a shopping mall in the municipality of Gjorce Petrov. Tehnostroj is a mining company which is also a part of Multicorp Holding, along with the Radio Happy, a national radio station for broad audiences with every day on-air contents and entertainment”. Discussing the business potential of the country, Sead Kochan concludes, “Invest in Macedonia, because our country has an amazing geographical location for doing business, which provides numerous opportunities. We are close to almost all continents; we offer low taxes; and eager and skilled work force.” MULTICORP HOLDING COMPANY Miroslav Krlezha No.64, 1000 Skopje Tel.: +389 2 3144 466 +389 2 3111 559 [email protected] www.multicorpholding.mk

Leading Supplier of Conveyor Rollers Renowned for Quality and Innovative Approach As the leading supplier of high quality conveyor rollers, idlers and accessories, OVE Steel delivers superb products at competitive prices, designed to meet all of clients’ requirements. Partnering with world renowned manufactures, the company is recognizable for its quality engineered products, responsibility towards its customers, high level of professionalism, strict adherence to the international standards, innovative approach, and highlyskilled and experienced team. With over 30 years of experience and around 30 employees, Visar Banjica, co-owner of OVE Steel, has built an internationally renowned brand in the sector. The company’s main competitive advantages are the high quality products and affordable prices, as well as their commitment to technological innovation and the constant investments in research and development. OVE Steel produces carrying rollers, impact rollers and return rollers for conveyor belts. The company brings together world class practices to deliver high quality and high speed balanced rollers, suitable for heavy mining practices with large tonnage, and high speed conveyors. OVE Steel produces long life rollers which outlast conventional idler rollers in harsh conditions and which are suitable for the transport of corrosive material. They also repair rollers and can custom design the specifics of the rollers according to the client’s request. “We are proud of the innovative developments of the idler roller, which directly address the inherent problems associated with conventional idler rollers”, Visar Banjica says and adds that their rollers are the right choice for operations interested in reducing the total cost of ownership through extended service life and reduced change-out schedules. OVE Steel’s

strict control of the entire manufacturing process ensures maximum care and guaranteed customers’ satisfaction. Their products are manufactured with excellent quality materials and the final product is certified, according to European regulations and certificates of guarantee of quality.

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GOVERNMENT

Currently OVE Steel exports only to Kosovo, on average about 20.000 rollers annually. Exporting to Kosovo since 2012, their main client for the past five years has been the state-owned KEK, the electrical industry in Kosovo and all the mines they manage. “We would like to expand our services to the private sector as well”, Visar Banjica emphasizes. “We also like to distribute in Macedonia, and we are planning to expand our portfolio of products and export them to the European markets”, he adds. OVE Steel is adhering to their mission for develop strategic partnership to improve performance and reduce costs. “Our global net-work gives us access to state-of-the-art technologies, manufacturing processes and design capabilities available, which enables us to deliver the highest quality products and services to our customers”, Visar Banjica concludes. OVE Steel S. Negotino-Polosko, Industriska Zona, Vrapciste 1238 Tel.: +389 42 520 510 +389 78 433 339 [email protected] [email protected] www.ovesteel.com

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BUSSINESS & INVESTMENT OPPORTUNITIES

Leading Insurance Company Focused on Innovative Premium Services THE EUROPEAN TIMES

Gjorgje Vojnovich, CEO of Triglav Insurance SC, Skopje

With headquarters in Skopje and 256 employees throughout the country, Triglav Insurance SC, Skopje is the leading insurance company on the Macedonian market, by written premium and coverage of the territory. As one of the titans in the insurance sector, this non-life insurance company is constantly working on growth and innovation. Emphasizing the company’s dedication to providing highest quality products, Gjorgje Vojnovich, CEO, is proud of Triglav’s extensive network, which includes 17 branches and 27 representation offices. Triglav Insurance SC, Skopje is part of Triglav Group, the leading and largest insurance consortium in the region, with businesses in the whole Adriatic region. “Being number one for many years is truly a great result, which is predominantly due to our employees’ dedication. This is what we always try to emphasise”, Gjorgje Vojnovich says, adding that “we build character, not only a company.” The structure of their portfolio is very well balanced between the corporate and the private sector. As a superbly structured company, Triglav boasts a prominent corporate

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culture which is always improving. Emphasizing that Triglav is an “innovative company which offers premium services to the market”, Gjorgje Vojnovich highlights their global image which is distinguished by knowledge, experience and excellence towards clients, employees, shareholders and other stakeholders. The company is anticipating few challenges and numerous market opportunities in the next couple of years. The main challenges will be to adjust to the necessary EU regulations. Liberalisation of the motor third party liability insurance, when it comes to being, will affect the market by fuelling a “price war” and a change of prices. However, many more opportunities are on the horizon. Discussing the country’s potential, Gjorgje Vojnovich says “Macedonia still has a low gross written premium per capita, which is continuously improving on annual level. Currently, at €68 per capita, it shows that investments in the insurance business offer a real potential. Furthermore, the Macedonian Government subsidises 60% of the animals’ and agricultural insurance through a unique support program, promoting the improvement of the business climate in the insurance sector in general. Additionally, taking into account that Macedonia’s private hospital system is one of the most developed in the region, as well as the growing demand for these services, the voluntary private health insurance is a new product which has a strong potential.” Always on the cutting edge of technology, Triglav Insurance is stepping firmly into the digital era by working on projects which will cater to the needs of the “digital generations” who, as Gjorgje Vojnovich notes, “are not used to go to the store and directly deal with an agent”. “The main tasks and challenges for our company are keeping the status of leaders in innovative and premium offers on the market”, he concludes. Triglav’s dedication and achievements make this goal entirely within reach, to the satisfaction of their numerous customers. Triglav Insurance SC, Skopje Bul. 8-mi Septemvri No. 16 (Office Building “Hyperium”) 1000 Skopje Tel.: +389 2 510 2222 [email protected] www.triglav.mk

BUSSINESS & INVESTMENT OPPORTUNITIES

Building Strong Partnerships with Domestic and International Clients

Financial Inclusion through Savings House Moznosti

Guided by the principles of discretion and respect, Silk Road Bank AD Skopje distinguishes itself from other banks in Macedonia by following modern banking standards offered through client centred services. Originally established in 1993 as one of the first private banks in the country, Silk Road Bank today is owned by the Swiss holding company, Silk Road Capital, and is one of the country’s foreign investments. Rolf Schneebeli, CEO, points out, “We are the closest thing to a Swiss Bank Macedonia has to offer!” The Bank puts the relationships with the clients on the pedestal of its work. Rolf Schneebeli explains, “We are aiming to be one the best customer-driven banks. We are trying to organize all the processes and services around our client. Marketing is our philosophy. It means client orientation must exist in the attitude of every employee”. Silk Road Bank services individual and corporate clients, offering deposits and credits, mainly targeting small and medium enterprises. The bank has recently introduced its new e-banking system focusing on becoming the leader in the electronic delivery of banking services in the country. Rolf Schneebeli concludes, “We work towards becoming the first stop for foreign investors in Macedonia. We understand their needs and we operate in the local market. This makes us the best choice!” Silk Road Bank AD Skopje P.O Box 564, Dame Gruev 1, 1000 Skopje Tel.: +389 2 3251 900 [email protected] www.silkroadbank.com.mk

Established in 2000, Savings House Moznosti has continued the activities of the first microfinance institution in Macedonia, offerings financial support for the development of the country’s micro and small enterprises. Snezana Andova, CEO, emphasizes, “We believe in free initiative, individual creativity and personal responsibility. Our mission is to provide access to initial capital for people that need support for their good business ideas. Our goal is to create new jobs, and our method is to provide small loans for small businesses”.

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Rolf Schneebeli CEO of Silk Road Bank AD Skopje

Moznosti serves micro and small enterprises and individuals, offering financial products and services, such as loans and savings deposits. Snezana Andova points out, “We are serving clients in urban and rural parts of the country, offering savings and loans for the clients with limited access to banks services. Our advantage is that we have developed microlending methodology creating suitable products for this target groups, building and maintaining strong client relations”. This financial institution has built strong and recognized brand, collaborating with many international financial institutions such as EBRD, KFW and international funds including responsAbility, Developing World Markets, Symbiotics, Triple Jump, and domestic financial institutions such as MEDF, Habitat for Humanity and local banks. Following the main aim to develop its activities in the banking sector, Snezana Andova explains, “Our strategic goal is to become a bank and this transformation could be done by the support of a fit and proper shareholder. In this context, we are interested in working with a strategic foreign investor that will become a major shareholder”. Savings House Moznosti Jane Sandanski Blvd. 111, 1000 Skopje Tel.: +389 2 2401 051 [email protected] www.moznosti.com.mk

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GOVERNMENT

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Modernising the Agriculture Sector Macedonia is reforming the agriculture sector, encouraging farmers to adopt contemporary practices and bringing the sector up to EU standards. Foreign investors can find a wealth of opportunities in this sector, including land at very attractive prices. Macedonia has fertile soil, mild climate and diverse terrain, all of which allow local farmers to cultivate a variety of crops. The agribusiness is one of Macedonia’s most promising sectors. In 2017, the agribusiness, including agriculture, forestry, and fisheries, accounted for 10% of GDP and over 16% of the total number of employed people. Exports of agriculture and food products in 2017 constituted 4.8% of the total exports, compared to 5.3% in 2016, which is due to the increase of exports in the other sectors. The top markets for agriculture and food products are the EU and Western Balkan Countries (Serbia, Kosovo, Albania, and Bosnia and Herzegovina), accounting for approximately 82.3% of the total exports. The main export products from Macedonia are fresh and processed vegetables and fruits (34.8%), tobacco (24%), grains (13.5%), and beverages (12%). The main import products are meat (beef, poultry, and pork accounted for 20% of total agriculture imports), fruits and vegetables, grains, coffee, tea, and spices.

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Strong Government support Macedonia plans to develop as an ideal base for processing companies. Food and beverage processing are significant industries in Macedonia, as well as fresh fruits and vegetables. Processed foods include both semi-finished products (including frozen, dried, and concentrate) and finished products (canned and preserved). Over 75% of the processed foods are exported, mostly to the EU and to neighbouring countries. Most of the food-processing facilities are in privately owned. The Government emphasizes the food processing industry as a strategic priority and has created a number of incentives for investors. The National Strategy for Agriculture and Rural Development 2014 – 2020 aims to strengthen the capacity of Macedonia’s agricultural sector to compete in the EU and other regional markets and to promote sustainable development of rural areas. The strategy also focuses on improving the marketing of agricultural products and the implementation of minimum quality standards according to the EU approximated Law on quality of agricultural products and respective by-laws. The Government continues to offer big subsidies to farmers and points out that these subsidies are helping farmers to implement higher standards and boost exports.

AGRICULTURE

Wine is Macedonia’s second largest agricultural export after tobacco. Macedonia produces approximately one million hectolitres of wine annually in 75 wineries. Though Macedonia exports much of its wine in bulk, an emerging number of smaller private wineries are starting to export quality bottled wine, a number which is steadily increasing. Over 80% of the domestic wine production is exported, mainly to the EU, former Yugoslav countries, China, Canada, Japan, and the United States. Macedonia welcomes investors in its high-potential wine industry. Investment opportunities also exist for companies for equipment that will increase the volume of bottled wine and technology and supplies that will stimulate grape production.

Fruits and vegetables are leading sub-sectors Fruits and vegetables are leading sub-sectors in the country’s agribusiness. Vegetable production is export oriented. Almost 80% of the vegetable production is exported either as fresh, preserved, or processed vegetables. The production of vegetable crops is concentrated in the southern and eastern parts of the country, due to the favourable climate. Over 75% of the production is in open fields, 20% in plastic tunnels, and the rest in glass greenhouses. The top five vegetable crops are potatoes, peppers, tomatoes, cabbage and melons. Furthermore, the food processing industry in Macedonia consists of 50 companies with a processing capacity of approximately 120.000 tonnes of fruits and vegetables per year, with 91% concentrated on the processing of vegetables and 9% on the processing of fruits. The most significant raw materials are red peppers, industrial tomatoes, sour cherries, apples, and plums. Although the industry is export oriented, with

over 80% of production going to EU and neighbouring markets, there is a low level of utilization of the production capacities, but there are efforts towards improvement in this regard.

Growth in organic production Since 2009, when Macedonia adopted a new Law on Organic Agricultural Production, which is harmonized with EU regulations, the country has recorded substantive growth in organic production. The importance of organic farming is expected to grow on global level, putting Macedonia’s organic production on the map of the most promising sectors for investment. In the past three years, there was a noticeable trend of growth, both in terms of surface of the arable land certified for organic production, and the number of entities. In 2016, there were 529 registered entities in the system of organic agricultural production in the country, and they produce meat, dairy, honey, cereals, industrial oil crops, wine, fruits, and vegetables.

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Long winemaking tradition

Primary target area for attracting FDI Agriculture is considered as a primary target area for future investments, growth and development, including increased foreign direct investments. In addition to the strategic location at the crossroads of two trans-European transport corridors and the easy access to regional and EU markets, the country’s main advantages in the sector are the high quality arable land and the favourable climate. Domestic production of agricultural machinery is minimal, and the market relies on imports. There are substantial opportunities for foreign companies in the agribusiness area for equipment that will add value to the food processing sector, such as bottling, packaging, and refining equipment.

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ECONOMY

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Rapidly Developing Transport System Macedonia is situated in the centre of the Balkan Peninsula at the intersection of several road and railway links. Two Pan-European Transportation Corridors, Corridor 8 (East-West) and Corridor 10 (North-South) pass through Macedonia. Corridor 8 consists of the E-65 road from Varna, Bulgaria to Durres, Albania via Sofia, Bulgaria and Skopje, Macedonia. Corridor 10 consists of the E-75 road from Athens, Greece via Skopje, Macedonia, Belgrade, Serbia, and Zagreb, Croatia to Munich, Germany. The two nearest ports are in Thessaloniki, Greece, which is around 100 km from Macedonia’s border crossing in Gevgelija, and in Durres, Albania, which is around 150 km from the border crossing at Struga. Macedonia aims to position itself as a key crossroad in pan-European Corridor 8 (East-West) and Corridor 10 (North-South) inland transportation routes across Southeastern Europe. This include building new highways and regional roads, modernizing the railway network and building new tracks, implementing new technologies and a range of other projects, many involving opportunities for foreign investors.

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Over €270 million in road infrastructure in 2018 Macedonia plans to invest over €270 million in road infrastructure in 2018, as was announced by the Ministry of Transport and Communications. The assets will be allocated towards road maintenance, rehabilitation and construction projects in 2018. The Government plans to use a loan from Export-Import Bank of China (EXIM Bank) for the construction of the Skopje-Stip and Ohrid-Kicevo highways. Macedonia also plans to use the proceeds from loans extended by the European Bank for Reconstruction and Development (EBRD) and the World Bank for the construction and overhaul of various roads across the country.

New highways for faster development The motorway section Demir Kapija – Smokvica is an important link of the Corridor 10, the most important international route which passes North-South through Macedonia and provides a connection to the international modern transport network for the region. The section

TRANSPORT

Other infrastructure projects underway include the Skopje-Stip and Ohrid-Kicevo highways. The Skopje-Stip highway will be 47 km long and is budgeted at €226.7 million, and the highway is expected to be finished by the end of September 2018 and to dramatically reduce travel time from the capital Skopje to Stip, which is the largest city in the eastern region. The Ohrid-Kicevo highway will be 56.7 km long and is budgeted at €411.3 million, thus being the highest infrastructural investment in the past 50 years in Macedonia. It is estimated that this highway will be constructed by the end of 2019. The construction works of the new highway from Skopje to Blace should commence next year, bringing benefits to the citizens and businessmen of Macedonia and Kosovo.

Improving rail system Macedonia’s rail infrastructure includes incomplete segments along Corridor 8 and filling these gaps is a priority in current development plans. The project focuses on the railway sections along the Corridor 8: Beljakovce– Kriva Palanka–border with Bulgaria, which should be ready by 2025. Macedonia also reconstructed the railroad tracks from Tabanovce to Gevgelija, part of Corridor 10, with a loan from the EBRD. The Government has announced it will step up its invest-

ment in the rail system to make it more competitive regionally.

Fast-growing air transport Macedonia offers a well-developed air-transport system for goods and passenger traffic. The country has two international airports in Skopje and Ohrid. Macedonia’s airports are managed by Turkish enterprise TAV, through a 20-year concession that began in 2008. Under the concession agreement, TAV was required to modernize both international airports. The key goals for Macedonia’s aviation sectors are to promote low cost flights to European destinations and to further harmonise aviation legislation to meet EU standards. Low cost airline Wizz Air will offer 1.6 million seats for sale from the Macedonian market this year, representing an increase of 23% compared to 2017. In addition to the launch of its planned new Vienna - Ohrid service, the carrier will also boost operations from the Macedonian capital to Basel and Malmo during the summer season, with both routes planned to run daily.

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Demir Kapija – Smokvica has a total length of 28.18 km, starting from the existing motorway one kilometre before the crossing of the Vardar stream, then entering in Tunnel T1 with over 1.2 km length and crossing again the stream in order to leave the gorge and enter the mountains of Klisura (Kozuf). The project joins the existing motorway at its south end, and then closes the link between Skopje and the border with Greece in Gevgelija. The project, estimated to cost €218 million, will be ready to use in March 2018.

Wizz Air’s passenger share in Macedonia grew to 59% during 2017, resulting in 1.2 million passengers. The figure represents a growth of 32% compared to the previous year. The low-cost airline commenced operations from Macedonia in 2011 and has since welcomed over four million travellers to and from the country. With a strategic goal to enable growth and development of air traffic, the Government plans to start tender procedures for a threeyear contract to stimulate the launch of new routes by low cost carriers. The previous contract, awarded to Wizz Air in 2015 will expire in June.

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Apostol Pavle Airport in Ohrid

ECONOMY

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Energy for the Future The Macedonian energy sector is in a transitional phase from centrally planned and managed to a decentralized regulated free market. On the demand side, the key challenge is to improve efficiency of energy usage. On the supply side, challenges include the limited range of options for energy supply, due to Macedonia’s lack of oil, gas or high-quality coal reserves, and ageing generation facilities. These factors have resulted in a shortage of domestic generation capacity, as well as relatively inefficient facilities. In order to sustain economic growth over the medium-to long-term, Macedonia would have to address both demand and supply issues, which is among the Government’s major priorities. New investment in energy generation are being considered based on least-cost analyses and taking into account environmental standards. The rise in demand is also

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been addressed, mainly by promoting energy efficiency measures and market liberalization. In order to create the right incentives on both sides of the market, establishing an efficient energy market is crucial, which requires further sector reform, including legislation and regulation. Recent reforms are helping to address these issues, and the country is committed to further reforms, that will bring about full liberalization of the energy market. Macedonia has signed the Energy Community Treaty (ECT), which commits the signatories to implement the relevant parts of the EU acquis communautaire. In particular, the signatories aim to set up a single regional stable regulatory market framework capable of attracting investment in transmission networks and generation capacity, and fostering competition and interconnectivity, thus ensuring supply and realizing economies of scale.

Transitioning into fully liberalized system The Government has recently drafted a new Energy Law, which, once fully implemented together with the necessary secondary legislation, is expected to bring the country in compliance with its Treaty obligations. In addition, the privatization of distribution in 2006 and the subsequent substantial investment, have reduced distribution losses and collection shortfalls. Going forward, Macedonia’s challenge will be to implement fully its reform plans, which are needed to boost supply while containing demand. Implementation of the new Energy Law will result in full electricity market liberalization which, together with providing a stable and predictable legal and regulatory environment, is essential for attracting largescale long-term private sector investment in generation capacity. Market-based pricing, the promotion of energy awareness among users, including insulation of homes and businesses, and further increasing the collection enforcement, are some of the available measures. Energy reform will also have a favourable macroeconomic impact. Liberalized prices and private investment will help ensure the sector does not become a fiscal burden or a source of balance of payments pressures. Furthermore, in a liberalized environment, subsidy outlays can be reduced and cover social assistance to the poorest households only. Domestic electricity supply is mainly from thermal and hydro generation. The main domestic generation facilities are the lignite-fired thermal power plants in Bitola and Oslomej (together 800 MW), with the three generation blocks at Bitola alone representing 675MW. Both these generation facilities are owned and operated by the stateowned ELEM (Elektrani na Makedonija). In addition, there is a back-up thermal power plant fuelled by heavy fuel oil in Negotino (210 MW capacity). Hydroelectric generation represents the other main domestic electricity supply, with a total installed capacity amounting to 528 MW, out of which over 500MW is run by ELEM. As power plants, and in particular hydro power plants due to their dependence on hydrological conditions, cannot continuously be run at peak capacity, which is why the overall electricity generated by hydro facilities amounts to only 20% of total. Further modest domestic generation capacity exists in geothermal, solar and wind farms.

Focus on green energy Energy market developments in Macedonia include further construction of an internal gas distribution network. Gasi-

fication of the country can also contribute to lowering energy demand and increasing supply, as natural gas provides a more efficient option for heating buildings, and a denser gas network provides incentives to increase electricity supply by making relatively environmentallyfriendly cogeneration combined heat and power plants more attractive to build. Taken together, these energy policies should ensure the security of supply, and hence provide a necessary precondition for economic growth over the medium to long-term. A natural gas transportation pipeline operated by GA-MA, the gas transmission system operator jointly owned by the government and the largest oil distributor in Macedonia Makpetrol, carries Russian gas from the Bulgarian border to Skopje. This pipeline currently supplies primarily industrial users in the cities of Skopje, Kumanovo, and Kriva Palanka. The Government has established Macedonian Energy Resources (MER) to oversee construction of an internal gas distribution network.

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ENERGY

The Government continues to show interest in building natural gas interconnections with Greece and Bulgaria to diversify its sources of natural gas, perhaps through connections to the Trans-Adriatic Pipeline (TAP) or liquefied natural gas (LNG) terminals in Greece.

Investment Opportunities Macedonia welcomes investments in the energy sector. Companies can apply for tenders to construct sections of the national gas distribution network. ELEM is interested in upgrading the existing thermal power plants and it is exploring the possibility of building a new 150 MW thermal power plant in the eastern part of the country, where it is estimated that there are deposits of higher-quality coal. It is also considering offering a public-private partnership for exploration of coal at two new mines in the western part of the country – Mariovo and Zhivojno. The Government is investigating the aspects of converting the mothballed heavy oil-fired TEC Negotino power plant to natural gas as well as constructing new gas-fired power plants. In addition, the Government is exploring the possibility of extending concessions for building small-scale hydro power plants along the Vardar river. The largest hydro project is for two dams at Cebren and Galiste. This project would comprise a total investment of around €700 million and would add net generation capacity of 320–420 GWh.

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ECONOMY

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Aiming to Provide High-quality Healthcare Macedonia has made important progress during its transition from a socialist system to a market-based system, particularly in reforming the organization, financing and delivery of health care and establishing a mix of private and public providers. Though total health care expenditure has risen in absolute terms in recent decades, it has consistently fallen as share of GDP, and high levels of private health expenditure remain. The health of the population has improved over the last decades, with life expectancy and mortality rates for both adults and children reaching similar levels to those in ex-communist EU countries.

Three-tier healthcare service Macedonia has a well-established health care system and public health services network with good geographic distribution of resources and provision as well as financial accessibility. Primary care providers include general practitioners, paediatricians, gynaecologists and dentists; they are accessible to all citizens without cost-sharing. Patients register with a primary care physician of their choice and can switch to a new one twice per year. General practitioners are tasked with sending patients to specialized healthcare when it is necessary.

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Secondary care consists of geographically distributed specialist outpatient services and a network of general, specialized and clinical hospitals and university clinics. The type and volume of specialist services delivered at the health centres are defined at the state level according to historical data, health care needs and financial arrangements. Hospital care is subject to regional standards. Tertiary care is provided at university clinics in Skopje, defined according to the criteria for provision of health services that require professionally, organizationally and technologically complex and multidisciplinary treatment. The majority of hospitals are in public ownership, although the share of private hospitals has increased in the past decade and is continuing its upward trend.

Increasing market share of the private healthcare facilities The market for health care service provision was liberalized, enabling private providers to enter the market. Initially growth was slow, focused on privately paid dental care, specialist services and pharmacies. There was a major expansion of the private sector between 2004 and 2007, when the primary care sector was privatized. At secondary and tertiary levels, private providers that emerged since

1991 acted in parallel with the public system, providing services paid for out of pocket by the users. In 2012, the Government initiated arrangements for their partial incorporation into the health system by establishing a ‘Health Network’; a set of both public and private health facilities and providers at all levels of care throughout the country. The Government welcomes more international investments in healthcare facilities, equipment and services.

E-health system for increased efficiency In recent years, significant efficiency gains were reached with a pioneering health information system that has reduced waiting times and led to a better coordination of care. This multi-modular e-health system has the potential to further reduce existing inefficiencies and to generate evidence for assessment and research.

Significant investments in the pharmaceutical sector Macedonia’s pharmaceutical sector is also attracting significant investment. Pharmacies have to conclude contracts with the Health Insurance Fund (HIF) to be able to dispense medicines covered by health insurance. These contracts are negotiated and signed based on several criteria, including the geographical area of coverage of the pharmacy, especially for larger cities. There are around 800 private pharmacies with HIF contracts. The Health Insurance Fund acts as the single public purchaser of health services. The main sources of funding for health insurance are the contributions from salaries and transfers from other agencies for specific population groups (i.e. the unemployed, retired persons, persons receiving social assistance). The HIF purchases health services as specified in the broad basic benefit package, which covers almost all treatments and rehabilitation services. Changes in the Health Insurance Law in 2009 made all residents eligible for compulsory insurance coverage. Although the HIF is responsible for purchasing health services, the Ministry of Health finances capital investments in public health providers (facilities and medical equipment) and implements preventive and public health measures through the annual health programmes financed from the central budget.

Increasing number of educational facilities The number of faculties in medicine, dentistry and pharmacy have increased since the mid-2000s. Students can obtain their medical degree at three Medical Faculties in Skopje, Stip and Tetovo, and at four medical colleges in Skopje, Tetovo, Stip and Bitola. There are two Faculties of Dentistry at universities in Skopje, one at the University of Tetovo and one at the University of Stip. The three Faculties of Pharmacy are located at the universities in Skopje, Stip and Tetovo.

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HEALTHCARE

Training of nurses and other auxiliary medical personnel is available in 10 medical high schools geographically dispersed in larger towns. Upon completion of the four years of medical high school, nurses, midwives and technicians are required to undertake practical training in order to apply for and pass the state examination. The nurses who pass the state examination are eligible to apply to any health care facility and can obtain on-the-job training for the specific medical field in which they have been employed. Further nursing training to become chief nurse (three years of training) is available in four medical colleges in Skopje, Stip, Tetovo and Bitola.

Ambitious plans for future investments In 2018, the Government has announced the start an ambitious investment in a new Clinical Centre in Skopje. The cost of this project is estimated €120 million, of which €70 million will come from a loan from the Council of Europe Development Bank, and the rest will be funded by the budget. The new Centre, together with the renovation and modernization of many other facilities, will be the new modern face of the Macedonian health system.

Investment opportunities in health tourism The health tourism is another investment opportunity in Macedonia, because of its high quality and affordable services. Macedonia has many spas famed for their healing natural waters. Dentistry tourism is also increasing in Macedonia thanks to its world-class dental care with latest technologies that meet the highest international standards.

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St. Jovan Kaneo Church in Ohrid

ECONOMY

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Land of Nature and Cradle of Culture Macedonia is renowned as a country of nature and a cradle of culture. At crossroads of civilizations, the country offers a unique blend of ancient and modern, offering a rich multicultural experience. The beauty of Macedonia and all it has to offer can be experienced year-round. Macedonia has 279 licensed hotels categorized from 5 stars to 1 star, campground, and in total, over 71.000 tourist beds. The country has many tourist attractions, including three natural lakes, Lake Ohrid, Lake Prespa, and Lake Dojran, and high mountains suitable for camping, hiking, and winter sports. The country has four national parks and 33 natural reserves. Macedonia’s geographical location, scenic areas, and historic and religious sites provide opportunities for tourism industry investment, development, and management. Investments in the tourist sector are seen rising 6.9% in 2017 compared to 2016. The tourism sector offers export and investment opportunities and has significant potential for future development. By 2027, contribution of Macedonia’s tourism sector to the GDP is projected to reach more than €260 million, equivalent to 2.1% of the country’s GDP. The number of tourists continues to grow, and it is estimated to reach 750.000 visitors on annual level by 2027. Tourists primarily come from Turkey, Greece, Serbia, Bulgaria, the Netherlands, Albania, and Germany. In order to attract visitors, the Value Added Tax (VAT) on tourism has been reduced from 18% to 5%. Furthermore,

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investors in priority projects receive special benefits, such as 0% personal income tax and 0% VAT in the first 10 years of operation.

A city with rich history A major landmark in Macedonia’s capital city Skopje is the medieval fortress overseeing the city centre along with the Stone Bridge over the river Vardar, both dating from the time of the Byzantium emperor, Justinian Primus, when Macedonia was the leading province of the Eastern Roman empire. The Stone Bridge was built by the Turks on the site of a Roman bridge. The bridge gives access to the old part of the city where one can find the Turkish Bazaar. It is one of the best-preserved examples of urban Ottoman architecture in the Balkans. Once inside the Bazaar, one can visit Daut-Pasha’s Amam (public bath, 15th century, now an art gallery), the Mustafa-Pasha’s Mosque (15th century), the Clock Tower (16th century), and Kurshumli-An (16th century). In addition to its many historical monuments, Skopje offers an excellent gastronomic experience. There are numerous modern and traditional restaurants which offer tasty local food as well as international specialties. Furthermore, the bustling night life can be experienced in the numerous cafes, bars, and clubs located all around the capital. In less than an hour’s drive from the capital city of Skopje, one can enjoy medieval monasteries, churches, mosques, vineyards, bazaars, hiking, and skiing.

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The most popular tourist destination, which accounts for almost 80% of Macedonia’s tourist revenues, is Lake Ohrid. The town of Ohrid, in an area of great natural beauty, enjoys the protection of UNESCO as a historical and cultural heritage site. Lake Ohrid is one of the world’s oldest and one of Europe’s deepest lakes. It is over 300 million years old and has over 200 endemic species not found on any other place on the planet, including the famous delicacy, Ohrid trout. The town of Ohrid, which rests by the lake, is the birthplace of the Cyrillic alphabet and Slavic literacy. Ohrid has 365 churches and monasteries – one for each day of the year. One of Ohrid’s attractions is the church St. Jovan Bigorski built in 1020. The iconostasis in the monastery is considered one of the most beautiful and most treasured wood-carved iconostasis in the Orthodox religion. In addition, there is also an icon dating from 1020 with supposed miraculous healing power. Among the most beautiful monasteries is the monastery of St. Naum, located nearly 30 km from the town of Ohrid, in a serene environment on the shores of the lake. Lake Ohrid, with its stunning Byzantine churches, small cobblestoned streets, art galleries, fine accommodations, picturesque pebbly beaches, and lively nightlife, is a breath-taking place to visit.

Unique monuments Macedonia abounds with unique monuments, and amongst them is the megalithic observatory Kokino that is fourth on the list of oldest observatories in the world, according to NASA. The archaeological site Heraclea in the town of Bitola was founded in the 4th century and is the most well-preserved city from the Ancient Macedonian Empire. The ancient city of Stobi, first mentioned in documents from the 2nd century B.C.E., contains a 2nd century amphitheatre, the Theodosia palace, and early Christian ruins with ornate mosaic floors. Skupi is another archaeological site of the antique Roman city located

several km from the centre of Skopje. In the village of Kuklica near Kratovo, the Stone Town of Kuklica can be found consisting of over 120 naturally formed stone pillars or “dolls” that are 10 million years old. Legend has it that the stone dolls were guests at a wedding but were turned to stone, cursed by a forsaken bride.

Numerous churches and monasteries Churches and monasteries in Macedonia are among the country’s most precious treasures, where the spiritual and artistic heritage of the Byzantine Orthodox tradition is magnificently preserved. Macedonian churches share the essential characteristics of all Byzantine churches across the Balkans in terms of construction, design and artwork. Also, they have very unique elements; among these are the incredibly detailed and precisely made wood carvings found in many churches, especially in western Macedonia, created by the well-trained masters of the centuries-old Macedonian School of ecclesiastical art. Acknowledged as being among the most important in the world some Macedonian icons were recently displayed at a comprehensive exhibit by the Metropolitan Museum of Art in New York.

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One church for every day of the year

World renowned festivals In addition to the ancient and historical attractions, several international cultural events and festivals take place each year in Macedonia. The Ohrid Summer Festival of music and drama attracts artists from around the globe. The Struga Poetry Evenings, in the town of Struga, is a world-renowned poetry event that takes place every August, bringing together roughly 200 poets from 50 different countries. The capital city of Skopje is also home to the Skopje Jazz Festival every October and the May Opera Evenings, bringing together musicians from around the world. Furthermore, one of the most famous events in the country is the Galichnik Wedding Festival, an annual festival held in the Macedonian village of Galichnik in which a selected couple gets married in the traditional “Galichka” style wedding.

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Monastery S. Jovan Bigorski

TOURISM

Helping Tourists Discover Macedonia’s Hidden Treasures THE EUROPEAN TIMES

The Association of hotels, restaurants, cafes and camps - HOTAM is a voluntary and non-profit trade association of hotel and catering businesses in Macedonia. Since 1999, HOTAM works to enhance and improve the hotel business climate in Macedonia by representing and promoting the industry to the general public, governmental bodies and allied organizations within the country and abroad. Having invested in the hotel business since 2003, Krste Blazeski, President of HOTAM, speaks about the current affairs in this sector and the investment opportunities in Macedonia. European Times: What are the trends in the hotel business in your country? Krste Blazeski: Since 2003, we have witnessed a growing number of overnight stays every year. The recent situation in the Balkans with a large number of people, migrants, and refugees transiting towards Western Europe set back the upward spiral of foreign tourists coming to Macedonia. Nevertheless, now that those occurrences are over in our part of Europe, we are hoping to revert to the numbers of tourists from the previous years. European Times: What are your development plans, projections, and initiatives? Krste Blazeski: Our ambition is to achieve a 10% increase in tourist numbers next year. Macedonia is building two highways and reconstructing the regional roads to our touristic destinations. Once these roads are completed, we will be able to attract more tourists who are visiting our surrounding. We have a lot of attractions, lakes, untouched nature, high mountain ranges, and ski slopes. An idea that we have suggested is called ‘Boat Stations’, to increase the

number boats operating in the village areas around the lake coastline, and with a particular emphasis on connecting the main cities of the Ohrid Lake, Ohrid and Struga. European Times: The Ohrid Lake is the oldest lake in Europe, protected by UNESCO, containing around 350 species unique to the lake. How is the development of tourism affecting the lake? Krste Blazeski: The developing tourism is not hurting the lake, because today we have green hotels available, and hoteliers take care of the environment. Now we have approximately forty to fifty thousand guests in Ohrid and out of them seven to ten thousand are hotel guests. In the next period, we need to build more hotels, so we have more space for specialized, niche guests. European Times: What can be done to speed up the development of the tourism sector? Krste Blazeski: Businesses and the government need to develop the special tourist zones, which are now at their inception phase. We need to grasp the rising opportunities before us, and as businesspeople keep the pace with the fast-developing industry.

34 Museum on water, Bay of Bones, Ohrid

TOURISM

This landmark sports complex has been on the forefront of Dojran accommodation since 1984, hosting innumerable regional sports professionals. Born from the vision of the owner Blagoj Istatov, an international football player legend, this sports complex progressed step by step, becoming a uniquely integrated accommodation and sports training centre, and number one choice for sports teams with ultimate achievements. Istatov Hotel has a total of 75 rooms divided in five different categories – VIP, apartments, double rooms, triple and quad bedded rooms. Each room is decorated in contemporary style and equipped with air-conditioner, TV with satellite channels and DVD player, mini bar and hair dryer. Free WiFi is available throughout the property and free private parking is provided on site. The hotel features two business halls and on-site restaurant, offering specialties which make Dojran known widely, such as Dojran carp and perkia and other authentic Macedonian food. This sports complex also offers outdoor seasonal pool, sauna and highly equipped fitness area. Discussing sports facilities, Mishel Istatov, General Manager, points out, “We have three football fields, and a covered court for handball, basketball and volleyball, with capacity of 1.500 viewers. We are investing in solar panels for electricity and lightning on football courts, in order to fulfil UEFA’s standards for holding football matches.”

The second home for sports professionals At Istatov Hotel, international sports teams and individual sportsmen and sportswomen can fully focus on their off-

season training, or their event or pre-match preparations. “The tourists that come here are mostly sport oriented, international sports teams, mainly from Serbia, Bulgaria and Greece, come here for two weeks practice. Business seminars, friendly non-professional matches and excursions are also organized here. Annually we host sports coach exams for obtaining coaching licenses.” says, Mishel Istatov. He adds, “There is not a football club from Serbia and Macedonia that has not been here! Our guests are very happy here, it happens that one football team meets their competition here, but it is sports spirit and after training they all sit together to eat and drink!”

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Integrated Training and Accommodation Base for High Profile Athletes

Promoting unique touristic attractions For more than 25 years, the hotel operates with a hunting ground club, obtaining a concession for the usage of over 8.000 hectares hunting ground. Mishel Istatov states, “We have concession and organize fishing tournaments on the Dojran Lake also. This is very important for us, the more we promote country’s tourism, the better for us.” He concludes, “As Hotel Istatov we desire for improvement in sports worldwide, we also want tourism to be pleasure for everyone that visits our hotel and for them to feel like home.” Hotel Istatov Coast 5th of November, Nov Dojran 1487 Tel.:+389 34 111 111 [email protected] [email protected] [email protected] [email protected] www.hotelistatov.com

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ECONOMY

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Perfect Getaway in the Heart of Macedonia offers Superb Traditional Cuisine Nested in the heart of Macedonia, at the north-east coast of the famous lake Mladost near the city of Veles, Hotel Romantique – Veles offers travellers excellent service and a pleasant ambiance, captivating them with its warm atmosphere and famous local specialties, prepared and served by a skilled staff of professionals. With more than a decade of experience, over the years the hotel became famous for its impeccable service and hospitality. The facilities and the service offered by Hotel Romantique – Veles go above and beyond its three stars ranking. “Our commitment to achieve all our guests’ sophisticated needs and requirements is our main priority”, Slavche Eftovski, owner and manager, points out. “The finest service and our outmost dedication to each individual provide guests with a 3-star superior experience which distinguishes Hotel Romantique – Veles and Hotel Romantique – Dojran from the competitors”, he adds. The hotel has a total capacity of 25 luxuriously furnished and spacious rooms, tailored to make guests feel like home, each equipped with central air conditioning, minibar, free internet and 24/7 room service. The luxurious deluxe studious offer guests a chance to enjoy the flawless nature and the extraordinary view of the lake. The hotel’s restaurant, with capacity of 190 seats and a terrace of 350 + seats, is one of the favourite getaways for locals during the summer season, offering superb cuisine and access to the hotel’s pool and the private beach, where guests can relax and enjoy a wide variety of entertainment. The impeccable service, combined with the

excellent selection of freshly prepared traditional and international dishes, as well as the wide selection of wines, offer an unforgettable experience that enthrals the senses. “I am proud of our international kitchen where we serve international dishes, as well as traditional Macedonian food served in a very modern way. Every dish we serve is prepared by experts and contains the finest fresh ingredients, which brought us numerous awards for culinary and quality on an international basis, including the Prism for Quality in the tourism sector, awards for quality at the Tourism Fair in Novi Sad, medals at the International Festival for Gastronomy in Croatia and more”, Slavche Eftovski emphasizes. Hotel Romantique – Veles hosts the International Gastronomy Festival in Macedonia which is attended by representatives from various countries. In addition, the hotel also has a pizza bar with 140 seats and an aperitif bar with a fireplace for the comfort of quests during the winter season. Parking is also available free of charge, with a capacity of 80 vehicles. The hotel is equipped to host business meetings and seminars as well, offering two sound-insulated and airconditioned conference rooms with a capacity of 45 guests which, combined with the hotel’s location far from the noise of the city, make Hotel Romantique – Veles a perfect choice for various types of business events. Hotel Romantique – Veles Veles 1400 Tel.: +389 43 212 999 +389 78 400 036 [email protected] www.hotelromantik.com.mk

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ECONOMY

Ideal Hotel for Vacation and Events Offers Mesmerizing View of Dojran Lake Located in Star Dojran, the tourism pearl in southern Macedonia, Hotel Romantique – Dojran is the synonym for impeccable service in the hotel industry of the region. Offering a mesmerizing view of Dojran Lake, Hotel Romantique – Dojran is positioned directly at the shore, providing guests with a private beach area. An aura of grandeur fills all 37 luxuriously furnished rooms and suites, which are equipped to satisfy each guest’s needs and aspirations. Boasting luxury amenities, including a flat-screen satellite TV, wooden floors and a minibar, the rooms also come with a bathroom featuring a shower and free toiletries, with some units equipped with a spa bath. The tranquil and spacious rooms offer floorto-ceiling windows, as well as sitting areas, with 24-hour room service available. Guests can park their cars free of charge on spot. The hotel has a great hall for conferences, meetings, business meetings and seminars, as well as two sound-isolated, air-conditioned conference rooms with a capacity of 120+ guests, equipped with WiFi and modern audio-visual equipment. The stylish restaurant with capacity of 320 seats is famous for its delicious food which meets the highest standards of quality and a mix of modern, creative and traditional ways of cooking, offering a unique culinary experience. In addition to the restaurant and the cocktail lounge with a fireplace, guests can enjoy the sun on the sun terrace with capacity of 250 seats, which also features sun loungers and outdoor dining with view of the lake. Guests can also relax and enjoy the expansive outdoor pool with overlooks

the lake, and a children’s pool is available for entertainment of the youngest and unforgettable moments for the entire family. With its four superior stars rating, Hotel Romantique – Dojran is the ideal location for weddings, graduation ceremonies and various types of events. “Our share in our clients’ successful work is the result of our detailed planning, organization and consistency. Our entire efforts are directed towards professionally satisfying the needs of our guests”, says Slavche Eftovski, who own and manages this hotel in addition to Hotel Romantique – Veles. Discussing future plans regarding both hotels, as well as the potential for expansion in Ohrid, Slavche Eftovski empathises, “We are trying to approach the hunting and fishing business, since there are many beautiful destinations near both lakes for those kinds of activities. We have already signed contracts with several Greek associations for hunting and fishing and our plan is also to sign contracts with Italian associations as well”. “Macedonia may be a small country but offers an abundance of natural treasures, friendly people, and really tasty food which will pleasantly surprise any traveller”, he concludes. Hotel Romantique – Dojran Marshal Tito 19, 1487 Star Dojran Tel.: +389 034 225 050 [email protected] www.hotelromantik.com.mk/dojran

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TOURISM

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Perfect Blend of Warm Atmosphere and Unique Ambience by the Ohrid Lake Founded in 2006 as a family business, Hotel Belvedere is a one-of-a-kind four-star hotel situated in the serenity of a perfect location, surrounded by the pine forest of St. Stefan settlement and the magnificent view of Ohrid Lake. Hotel Belvedere offers a thriving combination of contemporary style and authentic Macedonian character along with warm atmosphere and unique ambience. The perfect balance between classical elegance and modern comforts leave a long lasting impression. From the elegant lobby with classical instruments and antiques, to the comfortable furnished rooms with breathtaking views, all visitors can relax and enjoy the unspoiled natural surroundings. The hotel is backed by employees with great enthusiasm, providing high quality service for every visitor. Filip Vasilevski, General Manager, points out, “At Hotel Belvedere you will feel certain warmth, great service, we are all family here providing together excellent hospitality. It’s a unique experience.” Discussing the success strategy of the hotel, Filip Vasilevski adds, “The main success strategy for any hotel and restaurant is to have new ideas and be creative. You need to invest constantly and keep up with the modern trends. You need to keep on building and adding new hotel amenities. Of course we don’t just renovate the hotel; we also

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“upgrade” the staff, by proving attendance to different types of courses and trainings”.

Creating memorable experiences Hotel Belvedere has 90 rooms divided in three different categories – standard, studio rooms and suites, offering all the necessary conditions to have a warm and unforgettable stay in the hotel. Offering lake or forest view, all the rooms are equipped with air conditioning, wide LCD screen with cable TV, work desk, mini bar, Wi-Fi internet and direct tel. line, bathroom with shower and hair dryer, terrace. The hotel features two highly equipped business halls, with capacity of 100 and 60 audience, an on-site Hotel restaurant with a capacity of 280 seats, Piano Lobby bar and antique shop.“ We are planning to build a spa centre too”, Filip Vasilevski says. Hotel Belvedere also organizes Ohrid Lake tours by boat and ship and provides rent bikes, in order to create unforgettable moments for its tourists. Filip Vasilevski also owns two restaurants – Belvedere, situated in the Centre of Ohrid and Restaurant Biljanini Izvori (Biljana Springs), widely known for its unique ambience and traditional Macedonian and international cuisine. He adds, “We may be

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the only ones who give our visitors the opportunity to eat at either of those restaurants even though they arranged an all-inclusive at this hotel. We do this because we tend to make the staying in Ohrid interesting to our guests; there is no room for monotony. We also organize all kinds of festivities in the hotels like weddings etc.” In order to complement its touristic capacity on the Ohrid Riviera offering high quality service and accommodation, this family business took under concession Hotel Filip. The General Manger explains, “Hotel Filip is equipped with 40 rooms. We also have one smaller cottage hotel, it’s called Vila Bisera, located in Lagadin offering about 25 exclusive rooms. Vila Bisera is not a part of the group with the two other hotels because it belongs to a third party, but our plan this year is to congregate Vila Bisera to the whole company. We have one pool in Hotel Filip and two pools in Vila Bisera. In Hotel Filip we also have a Fitness Centre and currently we are making a small children’s corner there”.

and preparations. In spring and autumn we have conferences and seminars held by foreign organizations, NGO’s and NPO’s. During the summer season we have mostly tourists from the Netherlands and Belgium, and in recent years we’ve also acquired some guests from Poland.” The hotel team is actively involved in attracting international tourists through investment in different marketing strategies such as online marketing, web sites and ads, making contacts with new travel agencies and tour operators and visiting international fairs in Belgrade, Sofia, Istanbul, the Netherlands and Belgium. Filip Vasilevski observes that several improvements should be done in the means of transport, in order to attract new tour operators who are subsidized and are motivated to bring new tourists in Macedonia.

Touristic hub for international visitors

He urges more international travellers to discover the charms of Ohrid, “Ohrid is a small touristic centre with a rich history and a lot to offer. Visit Ohrid, it is a wonderful place. Visit the hotels because they are also a part of what makes Ohrid beautiful!”

Hotel Belvedere provides accommodation generally to foreign visitors during the summer season, and local business tourists organizing seminars and conferences. Filip Vasilevski explains, “We have different types of guests. Around the winter holidays, our guests are mostly tourists from the neighbouring countries Albania, Greece and Serbia, for a short stay or off-season sports trainings

Hotel Belvedere Sv. Stefan b.b. 6000, Ohrid Tel.: +389 46 277 710 +389 46 277 720 [email protected] www.hotelbelvedere.com.mk

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TOURISM

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Ultra-Modern Hotel in the Heart of Skopje Ideal location and ultra-modern facilities make Hotel Dolce International the perfect choice for local as well as international guests. Nested in the heart of Macedonia’s capital, Hotel Dolce International is within close proximity of numerous tourism attractions, shopping centres, restaurants, bars and other entertainment options. “Even with the growing competition, Hotel Dolce International’s unique personalized service is recognizable among travellers. At Dolce International every guest is important”, Ivana Bozhinova, the Manager of the hotel, emphasizes. Hotel Dolce International’s facilities include 20 highly comfortable rooms, big lobby, bar, fitness centre, conference hall and an enjoyable outdoor area. The main service offered is accommodation with breakfast included, with the option of arranging HB or FB services at guests’ request. “Hotel Dolce International has a 24 hours business centre and we organizing business meetings and unofficial get-togethers”, Ivana Bozhinova points out. The hotel also offers a variety of possibilities like organizing tours, massage treatments and shuttle service. “We also have free parking for our guests in front of the hotel with video surveillance as well as a private garage”, she adds. With 60% business travellers and 40% tourists, the hotel’s reputation constantly attracts new guests, but also many returning customers. With an amazing 80% overall occupancy rate, Hotel Dolce International is even short in capacity during the busy season. “Opened in 2014, Hotel Dolce International is the second hotel owned by Dragan Lesikj, the first was one was opened in 2011. We are planning on expanding, either with reorganizing the interior here or with a completely new building”, Ivana Bozhinova says and adds that most of the visitors are from the Balkan and Europe, but there are also guests from USA, Mexico, India, Korea, basically from all around the world. “Every visitor is welcome at our hotel”, she emphasizes.

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Guests return for the hotel’s unique service In addition to the modern interior, the comfort, and the unique design, Hotel Dolce International’s advantage also lays in the highly professional hotel staff, all excellent English speakers and some speaking more than two foreign languages. Highlighting the importance of providing personalized service tailored to each guest’s needs, Ivana Bozhinova emphasizes the hotel’s dedication to customer satisfaction. “We are trying to provide the best service to our guests, starting from best offers and comfortable accommodation, to welcome drinks and free use of the gym, free parking place, excellent Wi-Fi etc. We can also provide any business consulting and advice as well as connections to the owner`s business network”, she says. Hotel Dolce International is constantly upgraded, with day-to-day changes in their services aimed at complete satisfaction of their guests. “We are planning on opening a massage saloon in the near future, where our guests will relax in a pleasant atmosphere after a long working or walking day”, Ivana Bozhinova points out. With a very high rate of returning customers, Hotel Dolce International’s goals set by its management for 2016 were not only fulfilled, but were also surpassed. “Guests are coming to our hotel again and again, which can only mean one thing – we are doing it right”, she concludes. Dolce International Hotel 48 Partizanska Str. 1000 Skopje Tel: +389 2 312 1561, +389 71 233 474 [email protected] www.hoteldolceinternational.com

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